Brokers warn against dual licensing

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Brokers offering a cautionary note about dual licensing after one such industry player had his broker license suspended for five years.

“Choose your winning horse,” John Panagakos of Dominion Lending Centres Home Financial told “Are you going to be a real estate agent and be professional at it, or are you going to be a broker and be professional at it?” I don’t know how to pull teeth – I go to a dentist for that.”

Recent regulatory censure has sparked a flood of that kind of sentiment among brokering vets. In that case, Shaoaullah Sadeghi, a dually licensed broker and real estate agent had his broker qualifications suspended for five years.

Indeed, many industry leaders refuse to allow those holding supplementary licences to work for them.

“Don’t try to be a chameleon or jack of all trades,” Panagakos said. “A few years ago I had a lot of real estate agents who wanted to park their licence with me -- they wanted to get into the mortgage side to make money and I declined everyone.”

Unfortunately, there is a common misconception by those outside the industry that a broker’s job is easy, which may account for the high number of professionals looking to add brokering to their business model.

“They don’t understand that I can do a deal in 25-30 minutes, all done and ready to go and they don’t realize that’s because of my 20-plus years of experience,” Panagakos said. “It didn’t take me 25 minutes, it took me 23 years.”

For his part, Drew Donaldson, mortgage broker and VP of Sales with Safebridge Financial has experienced similar professionals looking to join his team.

“It’s the whole philosophy of jack of all trades and masters of none,” Donaldson said. “We’ve had real estate agents want to become brokers part time and we’ve turned them away; If you aren’t focused 100 per cent on abilities as a mortgage professional you are doing your clients a disservice.”

To Donaldson, the key to success is to focus on one profession and stick with it.

“What you’ll find is the real estate agents who want to do that aren’t extremely successful,” he said. “It goes back to, are you servicing your clients the best you can? If you’re successful in one of those fields you don’t have time to muddle around in the other.”

  • James on 2013-09-23 8:19:53 AM

    Now time to clear the firefighters and other associated Public Service employees as well, who are part timers in both our industry and the real estate industries

  • Broker on 2013-09-23 8:35:18 AM

    Great about a slowing market is by nature it tends to pull the weeds. The article is bit mislead thought. The fact he had two licenses had nothing to do with losing them. Un-ethical behaviour happens with full time agents as well.

  • Broker 1 on 2013-09-23 9:52:43 AM

    Its about time as I think this is so not above board ... Greasy at its best.

  • Mike on 2013-09-23 11:45:10 AM

    What he fails to mention is that REALTORS are better educated in mortgaging than most mortgage sales begin with. To become a mortgage agent literially takes one course. A REALTOR has to know not only about how to help someone buy or sell a proerty, but the financial requirements need to qualify for a mortgage. In fact it would be my opinion that the REALTOR is in fact a better candidate to hire into a mortgage brokerage, than someone who just takes one course. And as one person commented, the reason the person lost their license is because of un-ethical behaviour.

  • Dan on 2013-09-23 12:18:45 PM

    Same for insurance brokers - they just want to lure clients into their office and sell at least something...
    Strongly support that dual licensing should be prohibited by the Mortgage Brokers Acts

  • @kiltedbroker on 2013-09-23 12:19:05 PM

    I am not a fan of dual-licensed individuals.

    They believe they are being smart by maximizing the earning potential from each client. However, in fact they are diminishing their ability to generate business leads because they don't have time to be proficient in either profession.

    Same applies when you throw insurance agents and lawyers in the mix. I know of a lawyer who got is broker's licence so he could handle refinances... didn't really work out so well from a referral and marketing standpoint.

  • Dan on 2013-09-23 12:26:00 PM

    To: Mike
    Full time/successful Realtor doesn't have time for anything else.
    Grass is always greener...

  • Rick on 2013-09-23 2:01:36 PM

    How embarrassing is this? Mortgage (agents, brokers) trying to limit the competition. Are we next discriminating against people whom are ambidextrous?
    If licensed people have passed the licensing requirements then we need to accept that these people with dual licences should be better equipped to handle the entire cycle of sale and/or mortgage re-financing. There are a lot of mortgage agents/brokers whom could even learn from these dual registrants.

  • Tony M on 2013-09-23 2:44:55 PM

    Ok lets get this straight... you don't think its ok to be dually licensed? John doesn't Re/Max own DLC?...I think if you can do the job and are licensed to do so then so be it. I am a real estate broker and mortgage broker, yes I agree that its difficult to do both and I do mostly mortgages however i listed and sold 8 houses this year and have completed a total of 17 real estate transactions for 2013... now explain to me, why would I give that up...not to mention these sales came from existing mortgage clients of mine... so before you rant look at the world this is what its all about.... hey walmart sells grocerys at one end of the store and repairs your car at the other, while you get a checkup at their walking clinic, dont forget to buy a lotto ticket on the way out and when you win come back tomorrow and western union your family some of your winnings...ALL UNDER ONE ROOF!!!!

  • Dan on 2013-09-23 3:02:21 PM

    To Tony M: You are perfectly right Tony! However, if I would be a Realtor I would never send client to the Mortgage Broker who holds real estate license - sorry, direct conflict of interest. I don't here to judge, but I think that you are loosing more mortgage referral business than gaining from your real estate transactions...
    Using your example - I would like to see Canadian Tire refer client who needs to do Western Union transfer to the nearest Walmart - hahaha (I don't even going into mediocre service level and grocery quality at Walmart).

  • Tony M on 2013-09-23 3:39:13 PM

    Hi Dan,

    You comments are well received, but my business model is not about getting referrals from realtors.. i can see how some may see it as a conflict of interest but if I were to get a client from a realtor I would refer them back to the realtor for the real estate transaction.. that's just me (don't bit the hand that feeds you!)...

  • Dan on 2013-09-23 4:27:11 PM

    Thanks for the honest answer Tony! It's a pleasure to have discussion with professional!
    I assume that most negative feedbacks caused by the fact that our industry (industries - RE as well) is overcrowded with part-timers and fly-by-night agents.
    I strongly believe that FSCO and governing bodies in other provinces should address educational and licensing issues in the Mortgage Brokering Acts' revisions.

  • John Dearin, AMP on 2013-09-24 6:09:45 AM

    Re/Max owns DLC? NO!

    Any other inaccuracies in this post?

  • Rachelle on 2013-09-24 7:05:34 AM

    Its great to be able to help your client purchase and do the financing as well. I have been enjoying it for over 10 years now and if I get super busy I just refer my client to another realtor and do the mortgage. I try not to listen to any negativity. Its very lucrative and I absolutely love the business and my clients.

  • @kiltedbroker on 2013-09-24 8:07:13 AM

    Wow - lots of comments on this thread. Love to see discussion.

    Rick - This has nothing to do with limiting competition in the broker channel, it has everything to do with raising our level of professionalism. I don't view other brokers as 'competition" nor should any other broker for that matter.

    The bank has 75% market share... rather than eating each others lunches, we should consider working together to go after the banks sizeable piece of the pie. We need a unified voice.

    I don't believe that any person can appropriately give the proper attention to their clients if their interests are split between 2 careers. IMHO it is irresponsible and dangerous as it relates to our public image as professionals.

    Tony M - Wow, where to start with you... Walmart eh? Really? Could you have picked a worse example?

    How would you feel if the guy who was stocking grocery shelves was the same guy who overhauled your engine in the auto shop and was the same guy who gave you a prescription in the medi-clinic, sold you that winning lottery ticket and then helped send the money off via Western-Union?

    How could that individual possibly inspire confidence as a professional? What would he be a professional at?

    The point here isn't whether one BUSINESS should offer all the services related to the mortgage process, (The company I work for has a mortgage, financial planning and insurance division) the conversation is around whether one INDIVIDUAL should be able to split his/her time between 2 professions and degrade the professional image of a both in the process.

    Just because you have the ability to do both doesn't mean it is in the best interest of our profession.

    Am I suggesting we limit a competent, qualified mortgage broker's ability to become dual-licenced, in order to protect the integrity of our profession?


  • Lior, Mortgage Edge on 2013-09-24 8:33:38 AM

    There is a reason why top real estate agents and top mortgage brokers don't do both: they don't have time and if they are doing so well in one job, why look at another profession?

    Real estate is a demanding job, much more than mortgage brokering in my opinion. The fact that many real estate agents are passive and their idea of selling a home is putting it on MLS and hitting auto pilot is the reason why some of them get into mortgage brokering. Too much time on their hands! For them, mortgage brokering is not a profession, it's a "side job". They are a disgrace to the real estate and mortgage profession. Ask any Realtor who does 50 or 60 deals a year if they hold a mortgage broker license! With an average commission of $8,000 that's half a million dollars a year... why would I look at any other business or spend precious time negotiating with underwriters and getting customers to submit the supporting documents when I'm already bringing in half a million a year in income?

  • Ron Butler on 2013-09-24 8:42:37 AM

    Jackson, while I understand the point of your post: full-time mortgage brokers = better more professional mortgage brokers I also like to see things from the public's perspective.

    If I was Joe Citizen who was very pleased with my Realtor's work in finding a great house and negotiating a good deal and that same Realtor also offered me a highly competitive mortgage rate with a full featured contract and provided fast, professional service on all aspects of the transaction.............. what would be wrong with that?

    From the public's point of view there is nothing wrong with that. Will it happen every time? I don't think every time but definitely some times it will happen. Since I am not relentlessly opposed to mortgage brokers with other sources of income I cannot specifically be critical of Realtors who are dual licensed.

    To your point: it's the INDIVIDUAL who counts and if the Realtor who is also licensed as a mortgage broker is a great, hard working professional.............. why not?

  • Mike on 2013-09-24 9:10:50 AM

    Circumstances are different for all. Can a knowledgeable individual who processes strong ethical and professional attributes with good time management skills do both properly. I believe so.

    Can we agree that for an agent (mortgage & real estate) a large part of our day to day activity is go out and find our next deal and find new referral sources.

    Is it possible that Tony M has a steady book of business that is driven by repeat clients? Therefore he does not need to take a large portion of his time going out and meeting referral sources and finding new business. Instead he uses those extra hours a day to assist some of his clients in purchasing homes?

    For those who have been in the mortgage industry know many successful and knowledgeable agents/ brokers who spend little time in the office and are often out to lunch meetings, taking holidays or playing golf. They put 20 hours a week of work. Are these agents bad for the industry?

    The issue will always be regardless of a dual licenses or single licenses. Can one work in the best interest to the consumer? Giving knowledgeable and impartial advice is key and bad apples will appear regardless of being dual licensees or simply a Real Estate Agent or Mortgage Agent.

    John being that my spouse is a Dentist I don't think your example is comparable. But I take it was more of a comedic example.

    Also I have HEARD that Remax has some form of ownership or agreement with DLC. Same with Centum and Century 21. Please take it for what it's worth (not much) as I have no confirmation of such as I work for neither. I don't believe this was the point of the article as it had mostly to do with dual licenses.

    That said the article was deceiving since it makes it look that the person in question was suspended due to being dually licensed and not due to some form of fraudulent activity.

  • @kiltedbroker on 2013-09-24 9:51:42 AM

    Let me get this straight, I am not saying that a mortgage broker couldn't be effective at selling Real Estate or that a REALTOR® couldn't be good at writing mortgages - even doing both occupations at the same time. I believe there are probably a lot of people who could handle the work load and who could do both very well, even at the same time.

    I am simply saying that if we want the profession of mortgage broker to be taken serious by the public, it is better for our industry to limit our professionals to holding only one professional licence.

    I am speaking big picture here, so all the what ifs, and I know a guy who, and a what about the size of my network... is all crap. The exception should never be made into the rule.

    As a whole, big picture thinking - it would be more beneficial for the positive public perception of the mortgage professional if we limited our professionals to holding 1 professional licence...

    However with that said, it would be even better if we had a culture that assumed this was the best practice and self-regulated. Good luck that ever happening. So if it comes down to it, I would rather inconvenience the individual for the greater good of the group every single time.

    Ron - to your point of the professional REALTOR® handling the mortgage process and the question what would be wrong with that... nothing. But what would be wrong with referring that business to a mortgage professional who could do the same thing?

    The conversation has to be broader than a specific situation, sometimes limitations have to be imposed to better an industry as a whole.

    The reason this is a conversation is because the typical profile of a dual-licensed individual is more likely to be someone starting out in the industry who is trying to capitalize on a minimal client base than someone who already operates a thriving business.

    In my neck of the woods anyway... But I am sure other people have experienced it differently.

  • Paolo Di Petta | on 2013-09-24 4:16:43 PM

    Saying a good mortgage broker can't be a good Realtor (or vice versa) is like saying a good pianist can't sing (or also, vice versa) - it depends.

    All things considered - they're overlapping industries with shared skill sets. Understanding both help you understand each individual one better.

    At the end of the day, it comes down to 2 things 1. How much EFFORT (not time) someone puts into education and helping their client and 2. How ethical they are. Nothing else matters.

    Would you rather deal with a part time agent that puts in 20 solid hours a week or a full time agent that half-heartedly puts in 40 (or even 50) hours a week?

    The bigger concern is not "can a dual licensed person do it well" - it's "should they be handling both ends of the transaction". Personally, I'd abstain from double dipping (to avoid any COI issues), but that doesn't mean I wouldn't hold two licenses.

  • David O'Gorman on 2013-09-26 6:54:09 AM

    Will people ever get over this whining nonsense?

    The law in Canada is non-discriminatory. If you can pass the licensing requirements & comply with the law, you cannot stop people from doing two or more professions/jobs.

    I say again there are 6 people in Ontario whom are both medical doctors and licensed lawyers ( I am sure their mothers are doubly proud).These people spend their time in court or in front of disciplinary panels defending/prosecuting doctors. You can not stop people from doing what they are trained & licensed to do!

    Approximately 45% of the Principal Mortgage Brokers in Ontario (i.e. the owner/chief compliance officer of a mortgage brokerage) are also Brokers of Record under REBBA (owner/chief compliance officer of a real estate brokerage).
    As a Principal Mortgage Broker I would take a licensed real estate agent & train them to do mortgages any day over 99% of the "5 day wonders" coming out of any of the courses offered by any college or trade association mortgage agent course in Ontario.

    In the last 26 years I have taught something in the order of 16,000-17,000 real estate salespeople/brokers , mortgage financing in Ontario. Those same people need a total of something in the order of 220 hours of education to be a fully licensed real estate SALESPERSON. They know real estate, they know real estate & mortgage law, they comprehend the paper trail in both a real estate transaction & a mortgage transaction... all that & more.

    My concern of all mortgage agent/broker licensing courses has been, "If you don't know anything about real estate how can you teach some one to lend against it?"

    Back to my first point. If dual/multiple licensing was not allowed, then we would have half the number of cab drivers that we do in Toronto...because they couldn't use both their "5 day wonder" mortgage agent's license & drive cab.

    Its not the licensing, its the quality of instructors, quantity & rigour of the education. Clearly mortgage agent/broker education needs to improve dramatically on all these levels.

  • James Resourceful Capital Financial Corporation on 2014-11-19 11:22:36 PM

    In my time as a mortgage broker, I have come across many real estate agents that have dual licenses. But honestly, they are just trying to supplement their salary rather than be professionals in our industry. A full time professional mortgage broker is too busy to hold 2 or more jobs. And the same is true with Realtors. Its the realtors that aren't busy that tend to moonlight. But I am ok with it. As they usually still need my help to process, package and close their deal.

  • Asim , amp on 2015-04-26 1:08:00 PM

    in real world this news/article is just ignorance behaviour. people who have been working for 23 years have to come into real sense and should realized that Finance industry has much changed, regulated as compared to 23 years ago, , FSCO, OREA and other regulatory bodies do not restrict anyone to obtain as many licences as they want. In fact industry need people from all sort of back ground and all sort of discipline so the competition could work better for public.

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